Government enterprises urged to share 2% of profit to boost education

The government wants large public sector companies to share the burden of boosting expenditure on education. The Ministry of Human Resource Development (MHRD) has written to India’s largest public sector units (PSUs), proposing that they part with a portion of their annual profit to raise the standard of school education, particularly in rural areas and urban slums.

“Initially, we have written to top 100 PSUs, including leading government banks, for giving nearly 2% of their profit for improving school education as part of their social responsibility,” a ministry official said. “We are in consultation with private industry lobbies and will soon write to private companies on this.”

Another MHRD official said the ministry was hopeful the companies would cooperate. “Diverting a small portion of the substantial profit towards school education would help in achieving the objective of providing affordable yet quality schooling to children of rural areas and urban slums…” Both officials asked not to be named.

Total net profit of all PSUs in 2007-08 was Rs. 90,000 crore (Rs. 900 billion), according to the MHRD. India’s top 500 companies earned a net profit of Rs. 250,000 (Rs. 2500 billion) in the same year.

The Congress-led Union government plans to boost public expenditure on education from around 4% of the gross domestic product (GDP) today to 6% in the next few years, according to the MHRD. Around 237 million students are currently pursuing school education in India. But quality of schooling and high drop-out rates are major worries. Of every 100 students that enter class I, more han 55 drop out by the time they reach class X.

Currently, the cost of setting up a quality school is Rs. 3 crore (Rs. 30 million, but this may increase to Rs. 5 crore (Rs. 50 million) if better facilities are provided, according to MHRD estimates. Companies that accept the government’s proposal will be asked to fund the setting up of a school as well as its recurring cost for a decade, or a total of Rs. 15 crore (Rs. 150 million). In return, the school may be named after the company and around 10% of its seats may be reserved for children of he company’s employees.

“While up to 10% can go as discretionary quota, the remaining seats will be filled by the government,” said the second official cited above. Having schools named after them will serve as publicity for the companies. The companies can also play an active role in the management and evaluation of the schools they finance. If they don’t want to, the government will hand over the task to the Kendriya Vidyalaya Sangathan, which runs Central Schools, and Navodaya Vidyalaya Samiti, another MHRD-run schooling body. After 10 years, the company can either continue running the school or hand it over to the government.

U.D. Choubey, Director General of Standing Conference of Public Enterprises (SCOPE), an umbrella body of PSUs, said PSUs should contribute to school education as a social responsibility. “They are (already) doing various activities, including those in he education sector,” he said. “MHRD should enter into specific agreements with individual PSUs for this.”

Source: Mint, November 4, 2010

Manipal eyes corporate education market

Manipal Education has created a new business unit to capture a slice of the booming market in corporate education. Termed the Corporate Solutions Group, it will provide degree level courses in banking, science, capital markets and executive courses for working professionals.

“There has been lot of focus on K-12 and higher education, but there isn’t enough focus on corporate education,” said Anand Sudarshan, MD & CEO, Manipal Education, who expects the new unit to contribute a third of revenues for the Rs. 1000 crore (Rs. 10 billion) education services group in the next five years.

According to a report by IDFCSSKI, corporate training in India is estimated to be a US$ 50-million market that will expand by 25% in the coming years. As more companies prefer to outsource employee training to specialists in a bid to ensure quality and reduce costs.

“If you keep training in-house, it becomes a costly proposition and you wont have enough faculty,” said Manish Kumar, President and head of HR & CSR, Dhanalakshmi Bank. The bank trains its employees through a tie-up with corporate training outfit, Institute of Finance, Banking and Insurance (IFBI) set up by education provider NIIT in collaboration with ICICI Bank and various other corporations.

The business unit of Manipal has also set up ICICI Manipal Academy (IMA), to train probationary officers joining the bank. The residential course spread over nine months of campus training and three months of internship will provide a specialised diploma in insurance, banking, technology and soft skills.

Source: The Economic Times, November 4, 2010

Summer offers jump 75% at IIM Lucknow

Summer placements at IIM-Lucknow (IIM-L) hit a high note with 417 offers in just six days, a 75% increase in offers over the previous year. A total of 151 firms visited the campus, with 123 offers made in Slot Zero alone. Several prestigious firms made offers exclusively at IIM-L, including Wolff Olins Dubai (brand strategy), Samara Capital, Multiples Alternate Asset Management, Milestone Capital and Walden International.

Key recruiters on campus included McKinsey & Co., the Boston Consulting Group, Tata Administrative Services, Hindustan Unilever, Procter & Gamble, Aditya Birla Group, Cadbury-Kraft, Diageo, Avendus Capital and BNP Paribas.

Firms from the financial sectors included Goldman Sachs, JP Morgan, Citibank, HSBC, Standard Chartered, American Express, Deutsche Bank, Development Bank of Singapore, Edelweiss Capital, Axis Bank, Elara Capital, Atherstone Capital, SBI Capital, KC Securities, and BMR Advisors while FMCG firms also made their presence felt included P&G, HUL, Reckitt Benckiser, Glaxo-Smithkline, Coca-Cola, Pepsi, J&J Consumer, J&J Medical, J&J Pharma, Colgate Palmolive, Nestle, Heinz, Britannia, Asian Paints, Agrotech, Dabur, Marico, Kellog, L’Oreal, Perfetti Van Melle, ITC, Kraft-Cadbury and Diageo.

Source: The Economic Times, November 4, 2010